SEC Admin Case No. 08-11-132 In the matter of: Preaching Center Gospel Ministry, Inc. Enforcement and Prosecution Department, Petitioner

Republic of the Philippines Department of Finance Securities and Exchange Commission PICC Secretariat Building, PICC Complex, Pasay City

In the matter of: PREACHING CENTER GOSPEL MINISTRY, INC

SEC Admin Case No. 08-11-132

ENFORCEMENT AND PROSECUTION DEPARTMENT, Petitioner

DECISION

in Procurement under Section 6(i)(1) of P.D. 902-A August 2011 by the then Enforcement and Prosecution Department (EPD)-now known as the Enforcement and Investor Protection Department (EIPD)--praying that the Commission hereby REVOKE the Certificate of Registration of PREACHING CENTER GOSPEL MINISTRY,INC.on the grounds of: (1) Serious Misrepresentation under Section 6(i)(2) of P.D. 902-A; and (2) Fraud This resolves the Petition for Revocation of Corporate Registrationi filed on 24

RELEVANT FACTS AND PROCEEDINGS

I. PREACHING CENTER AND ITS HEAD PASTOR

originally incorporated as a Corporation Sole on 13 November 20002 under SEC Registration No. A2000016413, with Emilio M. Pabustan as its Head Pastor. PREACHING CENTER GOSPEL MINISTRY, INC. ("PREACHING CENTER")WaS

within the Philippines and abroad. Its corporate "affairs" (i.e., purposes) are listed in its AOI, viz: shall be responsible for the administration and management of its affairs, estate and properties According to its Articles of Incorporation (AOI),3 PREACHING CENTER's Head Pastor

a. To minister the NEW TESTAMENT: not of the letter, but if the [spirit] for the letter Killeth, but this Spirit giveth life as part [mentioned] in Mark 16:15,16:17 [and] Luke 24:47-49;

b. To establish and conduct Prayer [Meetings], Bible Studies, and crusades in different

areas such as barangays, schools, communities, jails, hospitals, [public] and private [offices], and unto the remotest areas as the Holy Spirit may lead;

C. To establish and build churches anywhere in the Philippines and abroad;

2 Certificate of Registration dated 13 November 2000 (Annex A of Petition) 3 Articles of Incorporation (Annex E of Petition). 1 Dated 23. August 2011.

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d. To establish, maintain, and conduct religious [endeavors] in the Philippines and abroad, to further spread the Gospel of Jesus Christ and for the spiritual maturity of [its] church members;

e. To produce and/or distribute scriptural, educational, and cultural materials and programs on print, film, tapes, slides, and other video and audio devices suitable for viewing and broadcasting;

To accept gifts, donations, bequests, endowments of property of any kind [or] description, in unlimited amount for [church], benevolent and/or educational purposes;

g. To acquire, hold, sell, and mortgage real estate and personal property, by purchase regard] the rules, regulations, and discipline of the church must prevail; or otherwise, [on behalf of] the church represented by such corporation sole; [in this

To do all such things, transact such business, and exercise such power and authority for the accomplishment of any one or more of the objectives appearing above for the benefit of the church.4

Bacol or, Pampanga. On 2 December 2009, Emilio M. Pabustan died of coronary artery disease in Sta. Ines,

Amendment was approved6 by the Commission on 14 January 2010. ("Amended AOI") to reflect the assignment of Susan O. Pabustan as new Head Pastor. This On 23 December 2009, PREACHING CENTER amended5 its Articles of Incorporation

II. LETTER-COMPLAINT OF CONCHITA PABUSTAN

certain Conchita Pabustan, which was prepared by her daughter, a certain Eleanor Pabustan. Department (CRMD) issued an Internal Memorandum? forwarding the Letter-Complaint of a On 15 February 2010, the Commission's Company Registration and Monitoring

PREACHING CENTER. Conchita Pabustan specifically alleged that: Briefly, the Letter-Complaint sought to revoke the certificate of registration of

(a) PREACHING CENTER was used by her late husband, Emilio M. Pabustan, as a front for his acts of immorality with his mistress; (b) Emilio M. Pabustan had no prior religious training or background; (c) PREACHING CENTER did not have faithful believers/members/followers; (d) PREACHING CENTER does not conduct prayer meetings or worship services; (e) PREACHING CENTER's chapel was closed after 2 years;

5 Amended AOI indicating new Head Pastor (Annex F of Petition). Certificate of Filing Amended A01 dated 14 January 2010 (Annex B of Petition) 7 CRMD Internal Memorandum to EPD dated 15 February 2010 (Annex C of Petition) 8 Letter-Complaint of Conchita Pabustan (Annex D of Petition). 4d

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(f)PREACHING CENTER never complied with its reportorial requirements: (g) PREACHING CENTER is doing business for profit;

(h) Emilio M. Pabustan unfairly donated their conjugal land in Pampanga to PREACHING CENTER, without her knowledge or consent;

(i) The the Letter-Complaint, seeking Revocation of PREACHING GOSPEL, is ultimately to recover the said conjugal land in Pampanga; (j) PREACHING CENTER is now managed by her daughter, Susan O. Pabustan, together with her late husband's mistress, Prencesita Sison, for their own personal interests; (k) PREACHING CENTER, through Susan O. Pabustan and Prencesita Sison, are continuously selling memorial lots to the public for their personal benefit, but covered by receipts issued in the name of PREACHING CENTER;

(l) PREACHING CENTER leased the church premises to a certain physician for the latter's exclusive use as a medical clinic, contrary to its religious purpose.

III. EPD SURVEILLANCE CONDUCTED IN PAMPANGA

pawnshop that PREACHING CENTER had transferred to the San Isidro Resettlement Area, a neighboring town. address at Block 117, Lot 45, San Fernando Ave.. Madapdap Resettlement, Mabalacat. Pampanga to investigate the affairs/purposes of the corporation sole. The EPD confirmed that the' church premises was being used exclusively as a medical clinic, i.e. the Dr. Orlando L. Feliciano Lying-in Clinic. Furthermore, the EPD was informed by the clerk of an adjacent Acting on the Letter-Complaint, the EPD conducted surveillance at the registered

members, and that the couple stayed there until his death in December 2009 when it was Memorial Park, Sta. Inez, Bacolor, Pampanga, where it was selling memorial lots. Resettlement, Magalang, Pampanga as the location of PREACHING CENTER. However, the site bore the name of a different church, "The Life and Teachings of Jesus Christ Gospel Ministry,l Inc."and it was "locked and seemed to be abandoned/uninhabited." The EPD were told by two local bystanders that this other church, "The Life and Teachings of Jesus Christ Gospel Ministry,l Inc.," was established by Emilio M. Pabustan and his "wife," that there were no other abandoned. The EPD was told that PREACHING CENTER was operating at the Holy Spirit The EPD, upon inquiry with local tricycle drivers, identified Block 22, Lot 21, San Isidro

Commission's database and is apparently an unregistered entity. "The Life and Teachings of Jesus Christ Gospel Ministry, Inc." does not appear in the

IV. EVIDENCE PRESENTED BY ELEANOR PABUSTAN

submitted her Verified Complaint,10 stating that: On 9 July 2010, the EPD invited Eleanor Pabustan for a Conference, during which she

1o Verified Complaint of Eleanor Pabustan (Annex L of Petition). 9 SEC I-View last accessed on 7 June 2017.

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(a) PREACHING CENTER was established by her father, Emilio M. Pabustan, in November 2000

(b) PREACHING CENTER was taken-over by her sister, Susan O. Pabustan, after her father's death in December 2009.

(c) PREACHING CENTER is not operating as a church;

(d) PREACHING CENTER is instead engaged in the selling of memorial lots for the benefit of Susan O. Pabustan and her late father's mistress, Prencesita Sison; she furnishing certificates, receipts, and affidavitsi1 as proof;

(e) PREACHING CENTER presently owns the Holy Spirit Memorial Park (through the efforts of Emilio M. Pabustan) but it used to be in the name of Emilson Development Corporation, a Pabustan family company; she furnished BIR Certifications regarding ownership of Holy Spirit Memorial Park as proof.12

Prencesita Sison, to wit: PREACHING CENTER, (b) its Head Pastor, Susan O. Pabustan, and (c) its Corporate Secretary, Eleanor Pabustan also provided the common addresses, to her knowledge, of (a)

(a) Block 22, Lot 21, San Isidro Resettlement, Magalang, Pampanga; (b) Holy Spirit Memorial Park, Sta. Inez, Bacolor, Pampanga.

V. ATTEMPT TO SERVE SUMMONS ON SUSAN O. PABUSTAN

had already left for Australia. Pabustan at the Holy Spirit Memorial Park, Sta. Inez, Bacolor, Pampanga. However, they were informed by Susan O. Pabustan's purported nephew, a certain Mikko P. Ortanez, that she On 27 August 2010, the EPD attempted to personally serve summons on Susan 0.

The EPD took pictures13 of the Holy Spirit Memorial Park as evidence that: (a) There are only approximately ten (10) graves and the park is still mostly unoccupied; (b) The selling of memorial lots is suspended until further notice; (c) As of January 2010, Prencesita Sison (a.k.a. Francing) is no longer authorized to sell lots and all transactions made by her are dishonored; (d) The memorial park is managed by the following: (ii) ( Susan O. Pabustan; Holy Spirit Memorial Park; and The Life and Teachings of Jesus Christ Gospel Ministry, Inc.

VI. ATTEMPT TO SERVE SUMMONS ON PRENCESITA SISON 11 Documentary evidence of selling of memorial lots (Annexes G, H, H-1, I, I-1 of Petition) 12 BIR Certifications showing ownership of memorial park (Annexes J, K of Petition). 13 Pictures of memorial park and signage there (Annex M, M-1, M-2 of Petition).

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Lying-in Clinic. A certain Ms. Vangie, a member of the clinic staff, explained that the building used to have intermittent church activities, with few attendees, at the building now 117 Lot 45, San Fernando Ave. Madapdap Resettlement, Mabalacat, Pampanga, i.e. the registered address of PREACHING CENTER,now occupied by the Dr. Orlando L. Feliciano was turned over to Dr. Feliciano in 2009 and has been a medical clinic ever since. Thereafter the EPD were able to speak the Barangay Chairman, Javier P. Taruc ("Barangay Chairman Taruc"), who submitted a Certification14 as to certain facts. He stated that PREACHING CENTER occupied by the medical clinic. On the same date, the EPD attempted to serve summons on Prencesita Sision at Block

Isidro (i.e., Block 22, Lot 21. San Isidro Resettlement, Magalang, Pampanga, the premises of The Life and Teachings of Jesus Christ Gospel Ministry, Inc.) but could not recall when such transfer occurred. Barangay Chairman Taruc also. confirmed that PREACHING CENTER had moved to San

VII. FURTHER INVESTIGATION OF SUSAN O. PABUSTAN

representative, Leonardo T. Pabustan, who attested that: On 2 September 2010, the EPD held a Conference15 with Susan 0. Pabustan's authorized

(a) Before his death, Emilio M. Pabustan verbally assigned Susan O. Pabustan as Head Pastor of PREACHING CENTER;

(b) PREACHING CENTER has three church locations: () ( Sta. Inez (site of the Holy Spirit Memorial Park); San Isidro (site of The Life and Teachings of Jesus Christ Gospel Ministry, Inc.) Madapdap (site of the Dr. Orlando L. Feliciano Lying-in Clinic); and]

(c) PREACHING CENTER's church activities stopped when Susan 0.Pabustan left for Australia in May 2010;

(d) He has no personal knowledge of church activities in San Isidro; (e) PREACHING CENTER owns the Holy Spirit Memorial Park; (f) Emilio M. Pabustan was solely responsible for selling memorial lots; (g) The selling of memorial lots stopped when Emilio M. Pabustan died in December 2009; (h) Prencesita Sison was merely the Secretary of Emilio M. Pabustan.

the Bureau of Immigration, to verify the statements of Mikko P. Ortanez and Leonardo T. Pabustan. On 13 September 2010, the EPD requested the travel records of Susan 0. Pabustan from

September 201016 stating that Susan 0. Pabustan had no travel records whatsoever. On 27 September 2010, the Bureau of Immigration submitted a Letter dated 15

14 Certification of Barangay Chairman Taruc (Annex N of Petition). 15 Summary of Conference with Leonardo Pabustani (Annex O of Petition).

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VIII. FURTHER INVESTIGATION OF PRENCESITA SISON

explained she only just then received notices. She stated under oath that: On 20 September 2010, the EPD had a Conference17 with Prencesita Sison, who

(a) PREACHING CENTER has had no members'since its establishment in 2000;

(b) Emilio M. Pabustan owned Holy Spirit Memorial Park, which he did not want his wife PREACHING CENTER upon its incorporation in November 2000; (Conchita Pabustan) and children to inherit, so he transferred its ownership to

(c) The actual operation of the memorial park had stopped much earlier, when Mt. Pinatubo erupted in 1991 and buried the property in lahar; (d) She used to own the property in Madapdap (i.e. the medical clinic), until she sold it sometime in 2004;

(e) She currently owns the property in San Isidro (i.e. "The Life and Teachings of Jesus Christ Gospel Ministry, Inc.);

(f) When Emilio M. Pabustan died, she established a close relationship with his daughter Susan O. Pabustan, and agreed to appoint her as Head Pastor;

(g) Susan 0. Pabustan prepared the Amended A0I in December 2009, naming herself as Head Pastor, and it was she who decided to use the old address in Madapdap (which was already exclusively used by the medical clinic)

Hence, this Petition.

IX. FAILURE OF PERSONAL SERVICE OF SUMMONS

Pabustan, to be served at all three known addresses of PREACHING GOSPEL and Susan O. Pabustan. On 25 August 2011, Summons was issued against PREACHING CENTER and Susan 0.

requested to receive the Summons and reiterated that Susan O. Pabustan had gone to Australia. On 31 August 2011, upon service at Holy Spirit Memorial Park, Mikko P. Ortanez

executed an Affidavit of Service stating that personal service had failed. On 30 September 2011, Jose B. Nepomuceno, a messenger employed by the Commission,

X. ISSUANCE AND POSTING OF ALIAS SUMMONS

Order directing the EPD to manifest its intention to serve Alias Summons. On 10 October 2011, the Commission's Office of the General Counsel (0GC) issued an

16 Bureau of Immigration's negative certification of travel records (Annex P of Petition). 17 Summary of Conference with Prencesita Sison (Annex Q of Petition).

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On 18 October 2011, the EPD filed its Manifestation to serve Alias Summons.

Susan O. Pabustan, indicating all three known addresses. On 2 November 2011,Alias Summons was issued against PREACHING CENTER and

remained unanswered past the deadline of fifteen (15) days. The Alias Summons was immediately posted onto the Commission's website, where it

XI. MOTION FOR EXTENSION FILED BY PREACHING GOSPEL

Appearance with Motion for Extension of Time to File Responsive Pleading. On 26 January 2012, PREACHING GOSPEL filed with the Commission its Entry of

ISSUE

Whether or not the SEC Registration of PREACHING CENTER can be revoked, under PD 902-A. for Serious Misrepresentation and/or Fraud in Procurement.

DISCUSSION

Rules of Procedure, "if the respondent fails to answer the complaint within the [15-day] prohibited pleading shall be automatically expunged from the records of the case. was filed beyond the 15-day deadline to file an Answer. Under Section 3-12 of the 2006 SEC period, he shall be considered in default." Section 3-6 of the 2006 Rules also makes clear that a Motion for Extension of Time to File Pleadings is a prohibited Pleading; should one be filed, such At the outset, we note that a Motion for Extension of Time to File Responsive Pleading

Let us thus proceed to the merits of this case.

revoked, inter alia, for the following reasons: Under Section 6(i) of PD 902-A, a corporation's Certificate of Registration may be

is doing to the great prejudice of or damage to the general public18 Serious misrepresentation as to what the corporation can do or

Fraud in Procuring its Certificate of Registration19

Corporation Code, which provides that: PREACHING CENTER was registered as a Corporation Sole under Section 110 of the

the affairs, property, and temporalities of any religious formed by the chief archbishop, bishop, priest, minister, rabbi, or For the purpose of administering and managing, as trustee. denomination, sect, or church, a corporation sole may be

19 Section 6(i(1) of PD 902-A. 18 Section 6(i(2) of PD 902-A.

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other presiding elder of such religious denomination, sect, or church. (Emphasis supplied)

the Head Pastor---initially Emilio M. Pabustan, then Susan O. Pabustan. A corporation sole consists of one person only.20 In PREACHING CENTER's case, it is

sole--as corporate entities and as grantees of primary franchises, are subject to the their religious nature.21 jurisdiction of the Commission in matters that are legal and corporate, notwithstanding Religious corporations organized under the corporation code--including corporations

denomination, sect, or church to be administered or managed.22 Such a corporation sole can only be formed if there is an existing religious

I. SERIOUS MISREPRESENTATION

precisely, Black's Law Dictionary includes definitions such as a "congregation" and "a place where people regularly assemble for worship." The term "church" may refer to (a) a group of followers, or (b) a meeting place. More

requirement that the church must pre-exist the corporation sole. followers. Its corporate secretary, Prencesita Sison, stated under oath23 that it has never had any members since its incorporation in 2000. Moreover, it could never meet the legal In the first place, PREACHING CENTER has no church in the sense that it has no

meeting place, as none of its addresses are used for religious activities, to wit: In the second place, PREACHING CENTER has no church in the sense that it has no

(a) The SEC-registered address in Madapdap. is neither owned PREACHING CENTER.24.It is occupied by an unrelated medical clinic. nor occupiedby

(b) Prencesita Sison's property in San Isidro has never been occupied by PREACHING Christ Gospel Ministry, Inc.). There is no evidence that it has ever been used for church CENTER per se, but rather by an unregistered entity (The Life and Teachings of Jesus activities.

(c) Holy Spirit Memorial Park in Sta. Inez, owned by PREACHING CENTER, was not used as a church but rather in the business selling of memorial lots.25

administers and manages a church when there is in fact absolutely none. church-owned properties.26 As it is, PREACHING CENTER seriously misrepresents that it There must be a pre-existing church, in order for the corporation sole to administer

memorial park lots, which is clearly outside its essentially-religious purpose. PREACHING CENTER also seriously misrepresents that it is in the business of selling

22 SEC Opinion dated 14 February 1997. 25 Supra notes 11 and 12. 20 Roman Catholic Apostolic Administration of Davao y. LRA, GR No. L-8451, 20 December 1957 21 SEC Opinion dated 15 May 2001 23 Supra note 17. 26 Supra note 22. 24 Id.

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authorized to do, while doing another, unauthorized purpose (real estate for profit). Selling memorial lotsfor the personal account of Emilio 0. Pabustan, Susan O. Pabustan, and/or Prencesita Sison-is neither necessary nor incidental to PREACHING CENTER's religious purpose. This activity, therefore, also amounts to Ultra Vires under Section 45 of the Corporation Code, to wit: In other words, PREACHING CENTER does none of the purposes (church activities) it is

articles of incorporation and except such as are necessary incidental to the exercise of the powers so conferred. No corporation under this Code shall possess or exercise any corporate powers except those conferred by this Code or by its o

II.FRAUD IN PROCUREMENT

good faith to administer and manage a church, especially since the Barangay Chairman certified that there were a few followers in the beginning.27 The Commission has ruled that the fraud Commission for registration."2s "must be contained or connected with the documents and/or papers presented to this It is difficult to show that original Head Pastor Emilio M. Pabustan did not intend in

no such intention to manage a church, as she was aware that the true business of PREACHING CENTER was the selling of memorial lots. However, it is more easily shown that succeeding Head Pastor Susan O. Pabustan had

the Amended A0I in December 2009, she: Amended A01 in 2009, and not the original incorporation in 2000. When Susan 0. Pabustan filed Thus, the "procurement" contemplated in the EPD's Petition is the application for

(a) Named herself Head Pastor even though she knew there was no church to begin with, and knowing the corporation would be used instead for selling memorial lots for profit, amply proven by certificates and receipts;29

(b) Registered the Madapdap premises which she knew to be a false corporate address, as it was used exclusively by an unrelated medical clinic.

signage at the memorial park that transactions with "Francing" are dishonored.3o She was aware that Prencesita Sison was selling memorial lots. This is clear from her

was affiliated with The Life and Teachings of Jesus Christ Gospel Ministry, Inc. an unregistered entity. Susan O. Pabustan also claimed, through Leonardo Pabustan, that PREACHING CENTER

church over its properties. It can be inferred from Susan O. Pabustan's sudden disappearance after the Amendment that she had no intention to act as trustee of her purported church. Evidently, she had no church at all, as there were no church members and there was no church building. Section 110 of the Corporation Code states that a corporation sole acts as trustee of a

28 In re: Charyn Marketing Enterprise Co 27 Supra note 14 29 Supra note 11 30 Supra note 13. rn oration (SEC Case No. 03-05049, 13 October 2005)

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Susan 0. Pabustan manages it and that selling of memorial lots has stopped only underscores that such was its true purpose. The selling of memorial lots stopped at around the time Susan 0. Pabustan disappeared, corroborating Leonardo Pabustan's statement32 that "church activities" stopped when she left. Furthermore, PREACHING CENTER's signage3i at the memorial park claiming that

certificate of registration. member. Consequently, PREACHING CENTER is liable for fraud in procuring the (amended) Her actions and fraudulent intent undoubtedly bind the corporation as she is the only

Registration No. A2000016413, issued to PREACHING CENTER GOSPEL MINISTRY, INC. is hereby REVOKED based on Sections 6(i)(2) and 6(i)(1) of PD 902-A. WHEREFORE, premises considered, the Petition is hereby GRANTED. The SEC Certificate of

of this Decision for appropriate action. Let the Company Registration and Monitoring Department (CRMD) be furnished a copy

SO ORDERED.

Pasay City, Philippines; 27 July 2017

C TERESITA J. HERBOSA Chairperson

ANTONIETA F. IBE Commissioner Mod EPHYRO LUIS B. AMATONG Commissioner

JAME ommissione EMILIO B.AQUINO Commissione WW

32 Supra note 15. 31 d